Facilities managers will always need alternatives

Tracey Fairclough at Turpin Smale Catering Consultants explains the debate over whether smaller players will continue to enter the market.

How will they get noticed and used?

When I first joined the wonderful world of contract catering around ten years ago, there were just a few large players and many smaller ones; almost a completely different scenario to today.

I even remember buying the only book I could find mentioned ‘Contract Catering’ on Amazon for valuable insight into the brave new world I was stepping into; from the heady heights of marketing and advertising. My reading collateral referred to the “BIG 4” caterers who dominated the contract catering sector – Elior, Compass, Aramark and Sodexo. Within a year of joining one of the “BIG 4”, a fifth player emerged; cue the meteoric rise of Baxter Storey, the new kid on the block, and soon referred to as one of the “BIG 5”.

Today I’m a catering consultant at Turpin Smale and it’s my job to know who’s who out there, what they’re doing, how well they’re doing it and what they cost. Knowing the benefits of both large and small caterer is important.

I can categorically say the food service sector is almost unrecognisable to the one I joined ten years ago. The market has changed and is constantly evolving; that’s life. Why? Well the smaller guys are there to offer what the bigger guys seemingly can’t; a classic case of David Meets Goliath. Here are my pros and cons of both.

Smaller Caterers

Pros:

Quick to Change – They can change tactics quicker than larger caterers, even take a product to market quicker. A larger caterer has procedures involving many people, departments and processes, giving the smaller caterer the time advantage. You can also adapt your product around customer feedback and whilst they’re gaining approvals, can sell the street food concept they saw today… tomorrow.

A Family Feel – Feeling part of a family is an advantage; employees perceive themselves to be treated more like family, and in many cases they’re truly both a family member and part of the family business. This feeling creates tremendous energy during projects and through tough times. The “We Are Family” with a charismatic leader can lead a small catering business to great success.

Close to the Customer – Being close to customers is key to success. A large caterer has many layers, departments and procedures that can prevent close customer contact. A small caterer is much closer to the customer, better able to meet customers more frequently, develop more personal relationships, make more bespoke products and address customer complaints quicker and more personally, which makes long-term customer relations easier and more profitable.

Cons:

Lack of progression – Some small caterers manage to stay afloat and be successful without any further growth; for these players, it’s a case of “If it ain’t broke, don’t fix it!” The clients who stay with these, whilst content with ‘a family feel’ might get left behind and find it hard to move forward.

Capital Investment – Again, this depends on the company. Some may have significantly less in the pot, so are unable to afford to invest as much as the larger caterers. That being said, some smaller businesses have fewer costs and overheads, so they can splash out on bigger salaries which delivers a better quality of service provider, although they might not necessarily be able to refurbish to deliver a more upbeat, contemporary facility designed to drive sales.

Nowhere to hide – With the larger caterers, if you mess up or if you aren’t pulling your weight, it’s usually pretty easy to get away with it. In a smaller company, all eyes are on you – whether you’re the catering manager, account manager or managing director. Everyone’s attitude and contributions can have a knock-on effect on the whole team. While some people may find this daunting, others are spurred on by this. It makes them work harder and harder and can mean better results. This can be great because you’re in a small business, so you’ll get the recognition you deserve.

Large Caterers

Pros:

A name that speaks for itself –Usually industry-renowned brands which alone can benefit a particular industry-renowned client company; they have a proven track record, their goods and services often sell themselves and having a big player in your supply chain can be impressive.

More bundled packages – Generally speaking, the bigger the business, the more money they have to spend and invest and this is where they can offer clients more “bang for the buck”, such as add-on services including vending, event catering, cleaning and or reception services as well as catering and hospitality.

Multiple locations and sectors – Some of the bigger caterers operate across several sectors (i.e. visitor attractions, high street retail brands, education, healthcare, stadia, events) and this is where you, as a client company, benefit from the breadth of foodservice experience and knowledge.

Cons:

Red tape and bureaucracy – The layered multi-sector structures can be a drawback, decisions made slower, getting passed from pillar to post. The bigger caterers tend to be bound by more restrictions and rules, causing frustration for you – as a client – who just want things done a certain way (i.e. promoting that artisan producer in the nearby farm). Things are more rigid.

Just a number – Client companies served by the larger caterers sometimes see such a transformation in their supplier relationship that what was once a valued, devoted, family feel caterer has morphed into a sea of faces and a caterer that doesn’t seem to deliver quality engagement. Unfortunately, this is the by-product of the caterer’s success, as it’s transitioned from small to big and it’s become all about the numbers and you – as the client company – have become just a number.

More formal relationships – Smaller caterers do not tend to rely on e-mail as a way of communicating with members of the project team and tend to be perhaps more generally informal and rely on verbal communication – with clients, customers and stakeholders – as well.

Below: Summary Table of Pros and Cons of Small Caterer versus Large Caterer:

In conclusion it’s pretty clear that there are plenty of good reasons for smaller players to continue to enter the market and stay there. In fact, suffice to say, the market relies on them doing so. It will be these smaller players who’ll get noticed – as they are doing right now – and utilised because they do it differently to the larger caterers and, above all, clients will need them to provide alternatives.